Kia 2006 Annual Report Download - page 94

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094
KIA MOTORS 2006 Annual Report
If all stock options, which require at least two-year continued services, are exercised, new shares or treasury stock will be issued in accordance with the decision of
the Board of Directors. The Company calculates the total compensation expense using the option-pricing model. In the model, the risk-free rate of 10.0 percent
and 4.74 percent, the expected exercise period of 5.5 years and the expected variation rate of stock price of 0.8387 and 0.9504 are adopted for the first and second
stock options, respectively. Total compensation expenses have been accounted for as a charge to current operations and a credit to capital adjustments over the
required period of service from the grant date using the straight-line method.
The compensation expenses of ￦128 million, which were expensed before December 31, 2005, have been reversed due to cancellation of 16,655 shares of the first
grant stock option and 14,903 shares of second grant stock option for the year ended December 31, 2006. In addition, among the stock options granted during the
current period, 6,667 shares of the first grant option and 105,019 shares of the second grant option were exercised, so that the Company issued the corresponding
number of its treasury shares.
(30) Non-cash Investing and Financing Activities
Significant non-cash investing and financing activities for the years ended December 31, 2006 and 2005 are summarized as follows:
(31) Added Value
The components of manufacturing costs and selling and administrative expenses which are necessary in calculating added value at December 31, 2006 and 2005
are as follows:
(32) Employee Welfare and Contributions to Society
For employee welfare, the Company maintains a refectory, an infirmary, athletic facilities, a scholarship fund, workmen’s accident compensation insurance,
unemployment insurance and medical insurance, etc. The amounts of welfare spending for the years ended December 31, 2006 and 2005 are estimated at
￦310,575 million and ￦284,313 million, respectively.
The Company donated ￦4,524 million and ￦5,858 million to the Korea Archery Association and others for the years ended December 31, 2006 and 2005, respectively.
December 31, 2006 and 2005
Notes to Non-Consolidated Financial Statements
222
122,972
16,688
472,450
91,563
22,884
19,519
￦
2006 2005
1,062
101,982
24,404
417,273
162,893
15,909
20,486
Construction-in-progress transferred to land
Construction-in-progress transferred to buildings
Construction-in-progress transferred to structures
Construction-in-progress transferred to machinery
Construction-in-progress transferred to dies, molds and tools
Construction-in-progress transferred to vehicles
Construction-in-progress transferred to other equipment
Won (millions)
1,797,775
357,508
310,575
19,905
460,149
26,097
2,972,009
￦
￦
2006 2005
1,705,126
270,082
284,313
21,083
444,255
23,009
2,747,868
Salaries
Retirement allowance and severance benefits
Other employee benefits
Rent
Depreciation
Taxes and dues
Won (millions)